Notes:
There are three fundamental dimensions to a project: the timescale, the resource and the scope. Setting any two of these determines the third.
There are good business reasons for negotiating a fixed price and timescale for a project. It is also normal to define the scope – but in practice the scope definition is rarely unambiguous.
This leads to a tension during the project between the developer organisation (that wants to ensure the scope remains commercially achievable) and the the customer organisation (that wants to maximise the return on its investment). However, a failure to control scope means that the project will fail from the perspective of both parties.
Controlling the scope in a fixed price contract is difficult: you agree to supply a garden tap and the customer insists that gold plating is de rigure. We didn't have to deal with this problem on the pilot project because the scope was defined by the system being replaced.
When working with a customer to solve a business problem it is easy to get carried away and try to provide the best possible solution (and not the best solution possible within the budget).
There are several ways that the company has made controlling scope difficult for itself:
The documentation produced to define the scope of the project is poor.
Personnel see the ability to offer the customer gold taps as what the company is about.
Failure to catalog “standard” garden taps to offer customers. (Which means a lengthy process of designing and developing taps for each customer.)